BRIHAN MUMBAI KREEDA & LALITKALA PRATISHTAN, MUMBAI V. ITO (E(-I(1), MUMBAI

ITA 5414/MUM/2016

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 1718 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2009-2010
• Appeal Filed On: 02-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHAUDHARY ARUN KUMAR SINGH
• Assessee Lawyers: K GOPAL A R MS NEHA PARANJPE
• Keywords: Question of law; Condonation of delay; Cancellation of registration; Set aside
• Section: 143(3); 12A; 201; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH G, MUMBAI BEFORE SHRI RAJESH KUMAR, ACCOUNTANT MEMBER AND SHRI RAM LAL NEGI, JUDICIAL MEMBER ITA NO.5414/M/2016 ASSESSMENT YEAR: 2009-10 M/S. BRIHAN MUMBAI KREEDA ANI LALIT KALA PRATISTHAN, SHAHAJI RAJE BHOSALE KREEDA SANKUL, JAY PRAKASH ROAD, ANDHERI (W), MUMBAI 58 PAN: AAATB0609C VS. INCOME TAX OFFICER (E)- 1(1), ROOM NO.401B, 4 TH FLOOR, PIRAMAL CHAMBERS, PAREL, MUMBAI - 400012 (APPELLANT) (R ESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI K. GOPAL, A.R. MS. NEHA PARANJPE, A.R. REVENUE BY : SHRI CHAUDHARY ARUNKUMAR SINGH, D.R . DATE OF HEARING : 24.04.2019 DATE OF PRONOUNCEMENT : 31.05.2019 O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE ORDER DATED 11.07.2016 OF THE DIRECTOR INCOME TAX (EXEMPTION) [HEREINAFTER REFERRED TO AS THE DIT(E) RELEVANT TO ASSESSMENT YEAR 2009-10. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THE APPELLANT TRUST, BEING AGGRIEVED BY THE OR DER DATED 11.7.2016 RECEIVED ON 16.8.2016 PASSED BY CIT (A), MUMBAI 1, IN APPEAL NO . CIT(A)-I/E-I (94)/2013-14 FOR THE ASSESSMENT YEAR 2009-10, PREFERS THIS APPEAL ON THE GROUNDS, AMONGST OTHER, EACH OF WHICH IS WITHOUT PREJUDICE TO THE OTHERS, W HICH ARE SET OUT HEREIN IN STATEMENT OF FACTS/MEMORANDUM OF APPEAL. ITA NO.5414/M/2016 M/S. BRIHAN MUMBAI KREEDA ANI LALIT KALA PRATISTHAN 2 2. THE LD. CIT (A) MUMBAI 1, ERRED IN LAW IN DISM ISSING THE APPEAL FILED BY THE APPELLANT TRUST ON TECHNICAL GROUND OF LIMITATION W ITHOUT APPRECIATING THE FACTS AND CIRCUMSTANCES OF THE CASE & DENYING THE CONDONATION OF DELAY OF 21 MONTHS IN FILING APPEAL BEFORE CIT (A)-L. 3. THE LD. CIT (A) MUMBAI, ERRED IN LAW IN DENYING SUBSTANCIAL JUSTICE TO THE APPELLANT TRUST BY NOT CONSIDERING & APPRISING THE MERITS IN PROPER PERSPECTIVE AND DISMISSING THE APPEAL AS NOT ADMITTED. 4. THE APPELLANT CRAVES LEAVE TO ADD, TO AMEND, T O ALTER OR TO RESCIND ANY OF THE ABOVE GROUNDS. 3. THE ASSESSEE HAS CHALLENGED THE ORDER OF LD. CIT (A) ON THE GROUND THAT LD. CIT(A) HAS DISMISSED THE APPEAL ON TECHNICAL GROUND THAT APPEAL IS BARRED BY LIMITATION BY DENY ING THE CONDONATION OF DELAY OF 21 MONTHS IN FILING THE APP EAL BEFORE THE LD. CIT(A). 4. THE FACTS IN BRIEF ARE THAT THE ASSESSEE FILED R ETURN OF INCOME ON 8.12.2009 DECLARING AN INCOME OF RS. 42,7 8,127/-.THE ASSESSEE TRUST WAS REGISTERED AS CHARITABLE ORGANIZ ATION WITH DIT(E) , MUMBAI U/S 12A OF THE ACT VIDE REGISTRATI ON NO. TR./27679 DATED 14.06.1990 AND WITH CHARITY COMMISS IONER MUMBAI VIDE REGISTRATION NO. E-11894. THE LD DIT(E) PASSED ORDER UNDER SECTION 12AA(3) OF THE ACT WITHDRAWING/ CANCELLING REGISTRATION OF THE TRUST FOR A.Y. 2009-10 ON 23.12 .2011 AFTER ISSUING SHOW CAUSE NOTICE TO THE ASSESSEE VIDE LETT ER NO.DIT(E)/ITO (HQ)/WITHDRAWAL/26/2011-12 DATED 14.1 0.2011 CALLING UPON THE ASSESSEE AS TO EXPLAIN AS TO WHY T HE REGISTRATION GRANTED SHOULD NOT BE WITHDRAWN BY INVOKING THE PRO VISIONS OF SECTION 12AA(3) OF THE ACT. THE LD AO ON THE BASIS OF SAID WITHDRAWAL/CANCELLATION OF REGISTRATION OF THE TRUS T, DENIED THE BENEFIT OF SECTION 11 OF THE ACT TO THE ASSESSEE BY PASSING THE ORDER U/S 143(3) OF THE ACT DATED 26.12.2011. THE S AID ORDER WAS RECEIVED BY THE ASSESSEE IN THE MONTH OF DECEMB ER, 2011 ITA NO.5414/M/2016 M/S. BRIHAN MUMBAI KREEDA ANI LALIT KALA PRATISTHAN 3 AND APPEAL WAS TO BE FILED WITHIN 30 DAYS FROM THE DATE OF RECEIPT OF THE ORDER. HOWEVER, THE APPEAL WAS FILE D ON 31.10.2013 WHICH IS DELAYED BY 21 MONTHS. THE LD. CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE BY NOT CONDONI NG THE DELAY OF 21 MONTHS BY HOLDING AS UNDER: 5. SUBMISSION OF THE APPELLANT HAS CAREFULLY BEEN CONSIDERED. HOWEVER, IT IS NOTED THAT THE APPELLANT IS CLAIMING IGNORANCE OF T HE LAW IN THIS REGARD. HOWEVER, THIS CONTENTION OF THE APPELLANT IS NOT ACCEPTABLE SINCE IT IS ASSISTED BY THE CHARTERED ACCOUNTANTS WHO ARE WELL AWARE OF THE PRO CEDURES. THIS IS EVIDENT FROM THE FACT THAT DURING THE COURSE OF ASSESSMENT PROCE EDINGS THE CASE WAS REPRESENTED BY THE CHARTERED ACCOUNTANT. 6. IT IS ALSO NOTED THAT IN THIS CASE REGISTRATION U/S. 12A WAS REJECTED BY THE DIT(EXEMPTIONS) AGAINST WHICH ALSO THE APPE LLANT FILED APPEAL WHICH WAS DELAYED BY 618 DAYS. HOWEVER, HON'BLE ITAT VIDE O RDER DATED 20.11.2015 HAVE REJECTED THE APPELLANT'S PETITION FOR CONDONATION O F DELAY. THE HON'BLE ITAT HAVE OBSERVED ON PAGE 18 OF THE ORDER THAT 'IT IS NOT TH E CASE THAT THE ASSESSEE IS A LAYMAN AND NOT AWARE ABOUT THE PROCEDURE OF TECHNIC ALITIES OF LAW. 7. IN VIEW OF THE FACTS AND LEGAL POSITION AS DISCUSSED ABOVE, THE DELAY IN FILING APPEAL IS NOT CONDONED RESULTING INTO THE NON-ADMIS SION OF APPEAL. 5. THE LD. COUNSEL OF THE ASSESSEE SUBMITTED BEFORE BENCH THAT LD. CIT(A) DISMISSED THE APPEAL IN LUMINI BY N OT CONDONING THE DELAY OF 21 MONTHS BY IGNORING THE FACTS THAT T RUST IS GENUINELY AND TRULY ENGAGED IN THE CHARITABLE ACTIV ITIES AND IS BEING MANNED AND MANAGED BY THE PEOPLE WHO ARE HOL DING A VERY RESPONSIBLE PUBLIC POSITIONS SUCH AS MAYOR, MU NICIPAL COMMISSIONER AND LEADER OF OPPOSITION ETC. AND ALSO BY EMINENT PERSONS IN THE FIELD OF SPORTS AND CULTURAL AFFAIRS AND ALSO BROUGHT TO THE NOTICE OF THE BENCH THE ORDER OF THE JURISDICTIONAL HONBLE BOMBAY HIGH COURT IN ITA NO.1429 OF 2006 DA TED 29.03.2019 PASSED AGAINST THE ORDER OF TRIBUNAL WHE REIN THE ASSESSEE HAS RAISED THE SUBSTANTIAL QUESTION OF LAW OF WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE INCO ME TAX APPELLATE TRIBUNAL WAS RIGHT IN LAW IN NOT CONDONING THE DELAY ITA NO.5414/M/2016 M/S. BRIHAN MUMBAI KREEDA ANI LALIT KALA PRATISTHAN 4 IN FILING THE APPEAL BEFORE THE TRIBUNAL WHICH WAS DECIDED BY THE COURT IN FAVOUR OF THE ASSESSEE BY CONDONING TH E DELAY SUBJECT TO DEPOSIT OF RS.50,000/-. THE LD. A.R. TH EREFORE PRAYED BEFORE THE BENCH THAT SINCE THE ISSUE OF CONDONATIO N OF DELAY HAS BEEN DECIDED BY THE HONBLE BOMBAY HIGH COURT I N FAVOUR OF THE ASSESSEE, THE IMPUGNED APPEAL PENDING BEFORE TH E TRIBUNAL MAY BE SET ASIDE TO THE FILE OF THE LD. CIT(A) TO DECIDE THE ISSUE ON MERITS. 6. THE LD. D.R. ON THE OTHER HAND, RELIED ON THE OR DER OF LD. DIT(E). 7. AFTER HEARING BOTH THE PARTIES AND PERUSING THE MATERIAL ON RECORD INCLUDING THE DECISION OF HONBLE BOMBAY HIG H COURT IN ITA NO.1429 OF 2016 DATED 19.03.2019, WE OBSERVE TH AT THE HONBLE BOMBAY HIGH COURT HAS CONDONED THE DELAY AN D DIRECTED THE TRIBUNAL TO DECIDE THE ISSUE ON MERIT. THE RELEVANT PARAS ARE REPRODUCED BELOW: 6. IN THE PRESENT CASE, THE DELAY IN FILING THE APPEAL BEFORE THE TRIBUNAL IS CONSIDERABLE. HOWEVER, WHILE EXAMINING THE Q UESTION WHETHER SUCH DELAY SHOULD BE CONDONED OR NOT, IN ADDITION TO EN TERTAINING WHETHER SUFFICIENT CAUSE IS MADE OUT OR NOT, WE ARE ALSO LOOKING AT THE POSS IBLE FALLOUT OF THE APPEAL NOT BEING ENTERTAINED BY THE TRIBUNAL ON MERITS. IN T HIS CONTEXT, THE ASSESSEE HAS FILED AN AFFIDAVIT SUGGESTING THAT THE EARLIER CHARTERED ACCOUNTANT HAD GIVEN AN OPINION THAT NO APPEAL WAS NEEDED TO BE FILED. IT WAS UPO N BEING CORRECTLY ADVISED LATER ON BY THE NEW CHARTERED ACCOUNTANT, THAT THE ASSESS EE DECIDED TO FILE APPEAL BEFORE THE TRIBUNAL. ADDITIONALLY, WE NOTICE THAT C ANCELLATION OF REGISTRATION GRANTED UNDER SECTION 12A OF THE ACT WOULD DEPRIVE THE ASSE SSEE OF THE BENEFITS UNDER SECTION 11 OF THE ACT FOR ALL TIMES TO COME. WHEN THE ASSESSEE FILED A FRESH APPLICATION FOR REGISTRATION UNDER SECTION 12A OF T HE ACT, THE COMMISSIONER REJECTED THE SAME BY AN ORDER DATED 28/02/2014 ON T HE GROUND THAT ONCE THE REGISTRATION IS CANCELLED, THERE IS NO PROVISION UN DER THE ACT ENABLING THE ASSESSEE TO FILE FRESH APPLICATION FOR REGISTRATION. WHAT WO ULD, THEREFORE, EMERGE IS THAT BY VIRTUE OF THE ORDER OF A DIRECTOR OF INCOME TAX CAN CELLING THE REGISTRATION OF THE ASSESSEE, THE ASSESSEE WOULD NOT BE ENTITLED TO THE BENEFITS UNDER SECTION 11 FOR ALL TIMES TO COME. ITA NO.5414/M/2016 M/S. BRIHAN MUMBAI KREEDA ANI LALIT KALA PRATISTHAN 5 8. WE OBSERVE FROM THE ORDER OF THE HONBLE BOMBAY HIGH COURT THAT THE DELAY WAS CONDONED IN THE LARGER PUB LIC INTEREST AND THE TRIBUNAL WAS DIRECTED TO DECIDE THE ISSUE O N MERITS. ONCE THE ISSUE OF CONDONATION OF DELAY IN ASSESSEE OWN IS DECIDED BY THE HONBLE HIGH COURT , THE BENCH IS BO UND BY THE SAID DECISION OF THE HONBLE COURT AS THE SAME RATI O HAS TO BE APPLIED . WE ARE, THEREFORE, RESPECTFULLY FOLLOWING THE DECISION BY THE HONBLE BOMBAY HIGH COURT IN ITA NO.1429 OF 201 6 DATED 19.03.2019 AS STATED HEREINABOVE, ARE INCLINED TO C ONDONE THE DELAY AND RESTORE THE ISSUE BACK TO THE FILE OF THE LD. CIT(A) TO DECIDE THE ISSUE ON MERITS AFTER AFFORDING THE REAS ONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 31.05.2019. SD/- SD/- ( RAM LAL NEGI) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 31.05.2019 * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORDER DY/ASS TT. REGISTRAR, ITAT, MUMBAI.